Data privacy and governance are wealth management’s most essential and growing issues. They’re also two of the most significant compliance risks for your firm. The good news is that by partnering with Surge Ventures’ companies, you can reduce those risks and protect your business from costly penalties. We’ll walk you through the basics of data privacy, why it matters, how to comply with new regulations, and more.

What is Data Privacy?

Data privacy is a term that refers to the protection of personally identifiable information. In other words, it’s about ensuring your client’s data is secure and will not be shared with anyone without their consent.

Generally, there are two types of data privacy: Personal and corporate. Personal refers to individuals, while corporate covers companies or organizations such as banks or insurance providers who collect information about their customers as part of their business operations. The main difference between these two types is how they apply specific laws related to each type.

Why is Data Privacy Important?

Data privacy is crucial for all firms, especially wealth managers. Wealth managers handle sensitive information about their clients’ personal finances and often have a fiduciary duty to protect that information.

Data privacy protects your organization and its clients from potential harm caused by the inappropriate use of sensitive data. For example, if you don’t have robust controls in place over who can access client information and what they can do with it–or even if those controls aren’t up-to-date–you could end up sharing information inappropriately with third parties like marketing firms or recruiters who are looking for leads on potential new customers (or employees).

This type of breach may not only violate local regulations but also cause damage to your reputation among customers who value their privacy highly enough, not just because they’re worried about identity theft but also because they feel violated by having someone else invade their personal space without asking permission first.

What are the Legal Requirements for Data Privacy?

The General Data Protection Regulation (GDPR) primarily governs the legal requirements for data privacy. The GDPR is an EU law that came into force on May 25, 2018. It applies to all companies that collect or process personal data about individuals in the European Union (EU), regardless of where they’re based or whether they have a physical presence within Europe’s borders. And the regulations are quick to hop borders, this expands beyond a European concern.

The EU has also introduced other laws relating to personal data protection:

What are the Legal Risks Associated with Non-Compliance?

Some severe consequences exist if you must comply more with data privacy regulations.

How Can My Wealth Management Firm Comply with New Regulations?

Surge Ventures can help you with data privacy and data governance. Our team of experts has extensive experience in these areas, and we know how to develop a strategy that fits your needs.

We can help you with the following:

 What about Personally Identifiable Information (PII)?

Data security is not just about protecting non-personally identifiable information (NPII). It’s also about protecting personally identifiable information (PII), any data that can be used to identify an individual.

PII includes things like first name, last name, and social security number.

PII must always be protected because hackers can use it to access your accounts or steal your identity. To keep your customers’ private details safe from cyber attacks and other threats, you must know what they are and how to protect them.

Data privacy and data governance are essential for wealth managers.

Wealth managers, or financial advisers, are integral to the financial services industry. They help clients manage their money by providing advice on investments and other financial matters. The role of a wealth manager has evolved; they now offer guidance in areas such as estate planning, tax planning, and risk management.

To effectively serve their client’s needs while complying with regulations wealth managers need access to high-quality information about those clients’ finances–and this includes sensitive personal data like Social Security numbers or birth dates that could potentially be used against them if it were leaked out into the wrong hands.

In summary

Data privacy and data governance are essential for wealth managers. We hope this guide has given you an overview of what these terms mean, why they’re critical, and how to comply with new regulations.

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